Two questions we often hear from our clients who own real estate assets are “How much does it cost to ‘white box’ a suite?” and “Would white boxing this space help lease the space faster or for a premium?”

At AQUILA we help our landlord clients answer these questions frequently.

While we recommend talking to a leasing broker to determine whether this is the right approach for your property, the cost question is much more straightforward, so we wanted to address it in an article.

Our in-house project management experts have managed hundreds of build-out and white box efforts and put together this helpful guide for pricing a white box project.

Read Next: Should You Build a Spec Suite at Your Office Building?

In this article I will explain:

  • What it means to white box a space
  • How much it costs to white box a space
  • The benefit of white boxing a space


What Does It Mean to “White Box” a Space?

First, it’s useful to understand what the term “white box” means.

Saying that a space is in white box (or vanilla box) condition can mean different things to different people. Given that, it’s very important to ensure that this term, is understood by all parties. Avoiding miscommunication between landlords and potential tenants as to the condition in which a space will be delivered is key to successfully managing expectations and costs.

Some parties may take white box to mean nothing more than a cold, dark shell – completely unfinished with just exterior walls, bare floors and exposed ceilings – whereas others may think white box implies a more finished out look with paint, carpet and drop ceilings in place.

In general, in order to be considered white box, the landlord should, at a minimum, install exterior sheetrock walls that are ready to paint, a concrete floor, electrical switches/outlets and restrooms (one may be required to be ADA compliant) as required by code.

White Box Space at The Campus at Arboretum in Austin, TX

White box space including HVAC, dropped ceilings, carpet tile and more.

Sometimes, however, landlords will also install heating and cooling (HVAC) units with ductwork, return air and control systems, a dropped ceiling with tiles, and light fixtures. The walls could be painted white (thus the term, white box) and a carpet tile or wood laminate alternate flooring material might be in place.

This is why it is essential for all parties to understand exactly what is meant by the term “white box” condition and for it to be spelled out and documented in the lease.


How Much Does It Cost to White Box a Space?

The cost for a landlord to white box a space will vary based on the definition and associated scope. The existing condition of a space will play a key role in effecting the scope of work necessary to achieve a white box condition.  


Specifically, this initial condition will determine if the work will need to be permitted, and to what extent.

In Austin, it is likely that a demolition permit will be required at a minimum, with the cost dictated by the size of the demo project.

A full building permit may be required if the white box condition, as agreed upon between landlord and tenant, includes additional scope such as drop ceilings, lighting above that which is required by code, relocation or expansion of HVAC supply and return air, relocation or modification of sprinkler heads, installation of new exit signs per life safety code, drywall around exterior walls, demising walls throughout the space to create smaller offices, etc.

The cost for a demo permit in Austin can begin around $250, which is just a fraction of the cost for a full building permit (which can cost a few thousand dollars).

To learn more about the permitting process in Austin, Texas, read our article The Expert’s Guide to Getting a Permit for Your Office Build-Out in Austin, TX.


On the most detailed level, the areas where landlords should expect to spend money getting a space to white box condition (depending of course on existing condition and definition of delivery) are:

Construction Costs to White Box a Commercial Space
Estimated Cost
HVAC units with supply/return air systems and controls Cost depends on existing conditions, anywhere from $5-$10/RSF
Drywall at the exterior extents of space and additional drywall throughout the suite in order to demise and subdivide the space $5-10/Linear Foot (FL)
Dropped ceiling with tiles $3-5/SF
Lighting, electrical switches, and outlets (per code, or beyond) $3-5/SF
Restrooms as per code (per code, or beyond) $5,000-10,000/restroom
Concrete or alternate flooring materials $3-5/SF (If carpet tile use $23-$28 per square yard installed as an allowance)
Architectural services Around $3/SF
Mechanical, electrical and plumbing engineering services As much as $1.50/SF
Project management consulting services Generally 5% of managed costs
Permitting costs
  • Depends on extent of permit necessary, anywhere from $250 for a small demo permit to a few thousand dollars for a full building permit.
  • If full building permit is required a Permit Expeditor may be necessary and cost around $1,500 on top of the cost of the permit itself.
Accessibility inspection charges
  • Generally no more than $1,500 for plan review and final inspection per TDLR Registration. Please note that ADA/TAS review is only required on projects that are greater than $50,000.

Note: These costs are based on 2018 estimates in Austin, Texas. These costs are always changing so talk to an experienced project manager to get an updated cost estimate.  


Why White Box a Space?

Given these expenses, a natural question is why would a landlord want to deliver a space in this condition?

There’s a strong argument to be made that the tenant, regardless of use, will be able to swiftly convert a white box space to their specific requirement.

Additionally, the space will be more presentable to prospective tenants, especially if it was in rough condition, and it can be easier for prospects to visualize how their layout and programming would fit within the space.

All this adds up to a space that is generally easier to lease more quickly at potentially higher rates or a longer term than a space that is not showed and delivered in white box condition.

Lastly, tenants will view the construction allowance provided by the landlord going much further in a space that is in white box condition.  


Want to Speak With a Project Manager?

We hope this article helped to address some of the more common questions about why you may choose to “white box” an office space, as well as some of the considerations and costs involved.

Please don’t hesitate to reach out to our project management team here at AQUILA if you’d like to learn more or get to work on your own white box delivery project today.

Or to continue learning about marketing and leasing your property, visit the For Owners & CRE Investors section of the AQUILA Learning Center.


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